That said, the idea that we, as a society, should accept that phones, computers, and other digital devices protected by strong encryption are 100% private zones is like saying we should allow rooms the government may never, under any circumstance, access in a home. We're essentially saying that the individual's right to privacy trumps EVERYTHING. I was listening to Sam Harris the other day and he calls the obsession with privacy a new religion, one he deems just as dangerous as existing God-based ones. I can see his point.
If the FBI knows that X is a pedophile and has shoeboxes full of kiddie porn pictures in a room at his house, should they not be allowed to serve a warrant and search the home? Should X have the right to an unsearchable room in his home? What if X is found dead and the only way to bust the child porn ring is by searching that room? I think most sensible people would find it absurd not to search the room. But, instead, X has all of his child porn on his encrypted phone and there's no way to access it, even though the need is completely legitimate. I find this very troubling.
The only sensible way forward that I see is for companies like Apple to become key masters, something they, understandably, don't want to do. If they don't move in that direction, however, government will start to legislate and it will be a disaster. If Apple provides unbreakable encryption on their phone, they should store the key and be able to provide it when served with a legal search warrant. If they do this, they short-circuit the need for legislation. Otherwise we are guaranteed to see a day when every tech company, every online service, must log everything and somehow provide the government with access. And when that day comes, the burden will be far more onerous and loss of privacy far greater than if these companies got proactive now and came up with a reasonable solution.
The problem is that this isn't a new thing: you're basically describing cryptography (i.e. the ability to disguise material so it can't be seen, even if the wrong person gets their hands on it). Cryptography isn't new. It dates back to Ancient Egypt.
Leonardo da Vinci and Nostradamus wrote in codes so the authorities couldn't see their work. That was a form of cryptography. The "strength" of the encryption is also a useless argument - any type of encryption, from da Vinci's notebooks to AES-256, which you don't know how to break is indistinguishable from 'perfect' encryption.
The only difference is that we're living in a world where lots of personal, private information is stored and concentrated in one, portable device (cloud services notwithstanding). It's a big target for all kinds of nefarious purposes, and for that reason customers want their phones to be encrypted by default.
The law can often be frustrating for the sake of principle - do you want to know how many bloody daggers have been disallowed as evidence due to minor procedural issues? What about testimony that has been disallowed because it may have been procured by torture?
Look at the case of
Robert Elmer Kleason (the original 'Texas Chainsaw Massacre' guy): He was convicted and sentenced to death in 1975, but the appeals court found the original warrant to search his home deficient, meaning they had to exclude massive evidence like bloody clothes and watches of the victims which were found in his house. He spent a short time in jail for some other minor offence, but was released, lived in New York for a while before moving to England. They tried to extradite him in 2001 based on DNA evidence, but legal wrangles about the possibility of the death penalty if returned to Texas dragged the process on for 2 years before he died of heart failure at 68 years old.
In that case, the law was standing up for the principle of the police needing valid search warrants, then again for the principle not to extradite people to places where they could face (what the English deemed) a barbaric punishment. Even as a probable-murderer, he had rights.
In fact, it goes further -
even terrorists have rights. They can still enjoy all of the constitutional freedoms and human rights that you do. If you capture a terrorist and put him in prison, he has rights as to his detention conditions. This is important, because, who exactly is a terrorist? Today they are Muslim extremists, but tomorrow they could be political opponents.
Basically, we have always had the ability to encode and encrypt our information (whether electronically or manually), and the law has always stood for the principle, even if it leads to uncomfortable situations. This is not news.
Moreover, it's not going to do anything to stop terrorism. Terrorists could simply use burners, or have somebody remote-wipe their phones (unless the FBI manage to take that away, too!); they could use messaging apps with stronger encryption than the base OS, or they could go low-key and use SMS with cryptic phrases like "the monkey is in the fridge" (that's also a kind of cryptography) - that's what the Paris attackers did.